The Federal Government’s Future Made in Australia (Production Tax Credit and Other Measures) Bill 2024 has passed the Senate, which includes the Hydrogen Production Tax Incentive.
The Federal Government said the legislation is all about building Australia’s future: seizing the vast economic and industrial opportunities from the global net zero transformation and strengthening Australia’s economic resilience.
The legislation is one of the largest packages of support for the resources sector passed by Federal Parliament.
The Federal Government said production tax credits aim to help build industries of the future in Australia, while creating good, well-paid local jobs.
The legislation establishes two tax incentives:
- Hydrogen Production Tax Incentive – worth $2 per kg of renewable hydrogen produced between 2027–28 and 2039–40 for up to ten years per project
- Critical Minerals Production Tax Incentive – worth ten per cent of relevant processing and refining costs for Australia’s 31 critical minerals, for critical minerals processed and refined between 2027–28 and 2039–40, for up to ten years per project
The incentives will only be provided once projects are up and running, producing hydrogen or processing critical minerals used in products like wind turbines, solar panels and electric vehicles.
The Federal Government said it recognises that the best opportunities for Australia and its people lie at the intersection of industry, energy, resources, skills and our ability to attract and deploy investment.
These tax incentives are expected to leverage traditional strengths and encourage and enable new industries that help maximise Australia’s opportunities in the global net zero transformation.
